The Israel Deception

Is the return of Israel in the 20th century truly a work of God, or is it a result of a cosmic chess move to deceive the elect by the adversary?

Sunday, March 12, 2017

As central banks lose control over inflation, and manipulation of metals slowly ends, what is the real price of gold and silver

In the late 1970's central banks lost control over inflation forcing New York Fed President Paul Volker to push for a boosting of interest rates beginning in 1978.  In fact, during a six month period in that year, rates were increased 2% to a level of 9%, only to find out that inflation still continued to climb.

A year later inflation was raging at a level of 13%, and following President Jimmy Carter's firing of several people in his cabinet, declining confidence in the dollar led to gold shooting up an unprecedented $300 an ounce in a short amount of time.

Gold of course would go on to reach a then historic high of around $850 per ounce until Volker, who would become the next Chairman of the Fed under President Ronald Reagan, took the ultimate step of raising rates from 9% to 20% between late 1979 and 1981.

The moral of this story is that once inflation gets away from central bankers, only a move of raising interest rates to extreme levels will have any chance of taming the inflation monster, but at a cost to the general economy, as well as the stock markets.

Fast forward to 2017...

On March 10 central bankers in Japan and Europe both hinted that they may now be forced to end their policies of ZIRP and could soon commence on monetary policies of raising rather than lowering interest rates because the inflation they have been masking for the past nine years has begun to rise precipitously similar to what occurred in the U.S. economy during the 1970's.  Added to this was what the market titled 'Bond King' Bill Gross said about the 10-year Treasury, that if it reaches and stays above 2.6% it will mean armageddon for almost everything.
Investors need to watch only one number in 2017 to figure out what returns are going to look like across the various markets, bond guru Bill Gross said Tuesday. 
Whether the 10-year Treasury yield crosses the 2.6 percent mark will be critical both to the bond market and to stock prices, the fund manager at Janus Capital wrote in his monthly report for clients. The yield was around 2.39 percent Tuesday morning. Higher yields reduce a bond's face value. 
"If 2.6 percent is broken on the upside ... a secular bear bond market has begun," Gross said. "Watch the 2.6 percent level. Much more important than Dow 20,000. Much more important than $60-a-barrel oil. Much more important than dollar/euro parity at 1.00. It is the key to interest rate levels and perhaps stock prices in 2017."
Gross said the 10-year yield has been in a downward trend line since 1987. If that channel is broken, look out. 
"Investment happiness and/or despair may lie ahead over the next 12 months depending on it," he said. - CNBC

This week will see at least two, if not three or more important financial, economic, and political events occur that will have tangible effects on interest rates, inflation, gold and silver, as well as the overall economy.  These include but are not limited to:  The debt ceiling vote, the Fed's FOMC meeting and announcement, and elections in the Netherlands which could bring another anti-euro and anti-EU candidate to a presidency.

All if this of course is almost meaningless in regards to the potential of inflation moving into a higher gear no matter what the central bank does monetarily, and the Congress does fiscally.  Because through our 100 year plus virtual fiat currency system, where the purchasing power of the dollar has lost over 97% of its value, what would the price of gold and silver be if that inflation completely disconnects from any chance of central bank or government control?

Earlier today on March 12, Matterhorn Capital Management head Egon Von Greyerz laid out a chart of what the actual price of gold and silver should be today using dollar terms if the cost of inflation had been, and was allowed to effect money and asset prices.  And in his charts going back 300 years of actual inflation (not reported or manipulated), then gold today would be around $14000 in 1980 dollars, and silver above $650.
The 300-year chart of gold adjusted for real inflation shows that gold is now at the bottom of the range. Even more interestingly, the $850 top in January 1980, adjusted for inflation, would be $14,463 today.
300 year gold price
The 300-year silver price chart, adjusted for real inflation confirms that the 1980 $50 top would be $669 today. - News.gold-eagle
300 year silver price

Many will say that these prices are absurd, and that central banks will always have the ability to control and manipulate gold and silver markets, as well as obfuscate the reporting of real inflation.  But all one has to do is look back to 2008 when they had to come hat in hand for a taxpayer bailout to save the entire global financial system, or in 1980 when it took extreme measures that are impossible for them to do today regarding interest rates because of how high the U.S. and global debt levels are, and you will see that if the scenario of out of control inflation is already set, then it is only a matter of time now before they lose control over all prices and assets, and gold and silver will very quickly spring back to their equilibrium true values that will not just leave the metals unaffordable, but damn well completely priceless.

Saturday, March 11, 2017

Fed gold cycle number three: Severe pullback and selloffs before next rate hike on March 15

As we enter into the coming week of expected turmoil and potential extreme chaos in the economic and geo-political worlds, one asset appears to be following the same path it did just prior to Federal Reserve rate hikes that took place in December of both 2015 and 2016.

Leading up to the first rate hike in nearly a decade back in Dec. of 2015, the gold price was taken down under the expectation that higher interest rates would be an anathema for the precious metal.  And for a short time following the hike in rates, gold did indeed drop to a multi-year low of $1048 before subsequently skyrocketing to $1250, and later $1380 in 2016.

Image result for gold price chart 2015 fed rate hike

Then following the 2016 Presidential elections in November we began to see this same cycle occur as expectations of a another interest rate hike by the Fed in December rise in probability.  And sure enough gold was taken down into the $1100's before moving back up near the beginning of 2017.

Image result for gold price chart december 2016

And now in March of 2017 we stand on the cusp of another rate hike by the Fed, expected to occur from their meeting on March 15.  And like clockwork since the probability of an increase in interest rates shot up in late February, gold has been slowly declining for a month leading up to the decision.


Three cycles all occurring with the same price action for gold.  Which means that if the historic trends continue as they have for the two previous rate hikes in December of 2015 and 2016 respectively, we can expect the gold price to rebound within a couple of weeks after the March 15 decision.

Silicon Valley is expecting government to take care of unemployed as they replace millions of workers with robots

Technology, automation, and the elimination of jobs is nothing new, and has been around since the beginning of time.  However today the world is suddenly coming upon a threshold in which there are few natural horizons through which workers who lose their jobs to innovation can have something they can transition into.

Ie... when the automobile replaced the horse and buggy at the beginning of the 20th century, workers in that industry could retrain themselves to labor on the assembly lines of the new one.

But there are very few 'new industries' being created, with most of the automation being simply about replacing workers to do the same jobs that are currently available.  Drivers are being replaced by automated cars, fast food workers are being replaced with order kiosks and robot cooks, and 3-D printers are just now beginning to replace construction workers in the building of homes.

In fact, it is being estimated that by 2035, up to 75% of all current jobs could and will be replaced by robots or some other form of automation.  And without some completely new innovation that would require the use of human labor and intellect beyond what a robot could do itself, how will hundreds of millions if not billions of people sustain themselves without a viable means to earn a living?

Since Silicon Valley is one of the primary drivers behind this rush into automation, corporations like Alphabet (Google), Apple, and Tesla give little thought as to the plight of the average American, instead pushing for replacing these workers with cheaper foreign labor until robots, AI, and other technologies can eliminate them altogether.  And as a result there will one day soon be hundreds of millions of angry and restless workers with nothing to do, little purpose, and plenty of time to build up the momentum for civil unrest the likes of that no government has ever seen.

But of course the brains at these multi-national corporations have a solution to this problem... and it involves the government simply adding everyone to the welfare teat at a time when their coffers are completely insolvent.

Image result for silicon valley wants to get rid of workers for robots
Silicon Valley will be watching closely. As job loss due to automation becomes more of a foregone conclusion, pressure is likely to build on the tech industry to help usher in policies that will address it. 
Elon Musk, who promised that all of Tesla's new vehicles will be capable of driving fully autonomously sometime this year, admitted recently that he thinks universal basic income will be necessary. Eliminating driving roles alone would wipe out 2 million jobs in the U.S., increasing unemployment by 6 percent. - INC
The saddest part for the average American is that most are ill prepared to do anything but accept a decline to their standard of living, and to suffer through the ultimate shame of being on the public dole for the rest of their lives.  The U.S. education system, which 40 years ago was in the top 5 in the industrialized world, is now languishing in the bottom 30 as many high school as well as college graduates can't function beyond an 8th grade level.  And as the future of jobs and entrepreneurialship moves onto the internet and away from the factory floor, few will have the skills or talents to seize upon these opportunities to try to build a life through the necessary paradigm shift which is in the creation of multiple streams of income.

For the most part, human labor has always been considered cheap and disposable, and those in power and who have reached the pinnacle of success rarely consider the plight of those who struggle to simply survive and wrest a decent living during their productive years.  And whether it is in the slaves and citizens forced to build the Egyptian pyramids or Great Wall of China, or those who were treated as criminals by the Rockefellers when they didn't work hard enough in the coal mines of Appalachia during the latter part of the 19th century, the destruction of the working class in favor of automation will only result in the destruction of a society no matter how much free money or 'basic incomes' a government deems to provide them.

Friday, March 10, 2017

Bitcoin price flash crashes as SEC rejects application for a Bitcoin ETF

In a move that should have seen holders of Bitcoin rejoice rather than panic, the SEC on March 10 rejected the Winklevoss twins application to create a Bitcoin ETF, which would have seriously harmed the crypto-currency by financializing it under Wall Street control.

Yet because Bitcoin has become the primary crypto-currency of choice, easily winning out over other digital forms such as Etherium, Dash, and Monero, its volatility is extraordinary since it has already become partially financialized via Bitcoin exchanges.

And thus when the news broke we saw the price in USD fall nearly $300 down to $978.


After much anticipation (and a spike to record highs earlier today), The SEC has decided to reject the Winklevoss application for a Bitcoin ETF. 
The SEC premise appears to be the unregulated natuire of the underlying: 
Based on the record before it, the Commission believes that the significant markets for bitcoin are unregulated. 
Therefore, as the Exchange has not entered into, and would currently be unable to enter into, the type of surveillance-sharing agreement that has been in place with respect to all previously approved commodity-trust ETPs—agreements that help address concerns about the potential for fraudulent or manipulative acts and practices in this market - the Commission does not find the proposed rule change to be consistent with the Exchange Act. - Zerohedge
The irony is that Bitcoin should have gone higher rather than flash crash because supporters of the crypto-currency desperately want to keep it out of the hands of Wall Street, banks, and government regulators.  However, when we look at how activities taken by the Chinese government last month could cause the same type of volatility to the price of Bitcoin as today's ruling did, the question needs to be asked if the digital money has not already been corrupted to the point in centralization that it no longer provides the wealth protection and security that were the platforms that made Bitcoin unique.

The Live Free or Die state of New Hampshire looking at passing bill to de-regulate Bitcoin

Out of all the states in the Union, New Hampshire has long been known as the Northern rebel to the Federalization of the country that came following the end of the Civil War.  And with a state of motto of 'Live free or die', pockets of capitalists and anarcho-capitalists have flourished in New Hampshire as the state's laissez-faire mindset has allowed for more economic freedom than most.

So perhaps it is not surprising that the locale that was one of the original 'primordial soups' around the world for Bitcoin expansion is now pushing through legislation that would completely de-regulate the crypto-currency, and in essence promote its use in banking, commerce, and peer-to-peer financial transactions.

Image result for porcfest bitcoin
Graphic use courtesy of Coin Telegraph
HB 436 was introduced, drafted and proposed by Keith Ammon, Barbara Biggie and John Hunt, who are early adopters and supporters of Bitcoin. In fact, Keith Ammon introduced many people to Bitcoin as early as May 2011, when Bitcoin wasn’t legal. 
Hunt played an important role in getting the bill passed by the House of Representatives, as he brought the bill out of committee, defended it with Ammon and ultimately convinced the House to pass the bill. Ammon is particularly dedicated to passing the bill in the state of New Hampshire due to his involvement with the New Hampshire Liberty Alliance, a nonpartisan coalition formed to increase individual freedom. 
One of the main arguments presented by Hunt and Ammon when defending the bill was that if the US government doesn’t consider Bitcoin as legal tender, it shouldn’t fall under the regulatory guidance designed for money transmission services or products. The bill read: 
“‘Virtual currency’” means a digital representation of value that can be digitally traded and functions as a medium of exchange, a unit of account, or a store of value but does not have legal tender status as recognized by the United States government.” 
If the bill is passed by the Senate within 60 days, or two months, New Hampshire residents will be able to utilize Bitcoin without being subjected to tight money transmission regulations or policies. While it is still unclear if this would allow businesses to refrain from collecting user identity and data for KYC regulations and AML purposes, it will grant users in New Hampshire financial freedom and privacy. - Coin Telegraph

Thursday, March 9, 2017

With the gold to silver ratio over 70:1, exchanging gold for silver is an inexpensive way to start accumulating your stack

Contrary to much of the mainstream rhetoric given by brokers and mutual fund managers on how to grow your investments, one of the best and most inexpensive ways to accumulate wealth is by using the divergence between two precious metals to expand your assets.

Thanks to the U.S. government changing gold and silver from money to a commodity in 1971, the historic ratio of 10:1 or 15:1 has become broken due to the financialization of precious metals.  And it is through this mechanism that individuals can use the skewed ratio to their own advantage.

On March 9 the gold to silver ratio is now above 70:1, with the price of gold being approximately $1202 and the price of silver being around $17.18.  This means of course that it doesn't matter if gold is undervalued in relation to the dollar or other fiat currencies, but rather that silver is extremely undervalued in relation to gold.

24 hour gold silver ratio chart

So how does using the gold to silver ratio to your advantage work?  When the ratio is above 50:1 as it is now and has been several times over the past two decades, it is time to exchange a portion (large or small... it is all dependent upon your appetite) of your gold for silver.  And likewise when the ratio then starts to fall down from a high to one that is below 50:1, the opposite is in effect where you exchange your silver stack for gold.

Example:  5 ounces of gold minus a premium cost (average) of $2.29 for each silver ounce allows for an exchange of approximately 309 ounces.

Now let's look at the historic chart for the gold to silver ratio since 1971 and see how many nexus points allow for a profitable exchange of one metal for the other.


Over the course of the past 35 years, there have been at least eight different cycles in which it would be profitable to exchange gold for silver or vice-versa when the ratio's reversed from one level to its opposite.  (These are approximate estimates based on the above chart)

1973 - 1977   - Silver for gold when ratio went from 43:1 to 23:1
1977 - 1979   - Gold for silver when ratio went from 23:1 to 18:1
1979 - 1982   - Silver for gold when ratio went from 18:1 to 56:1
1982 - 1984   - Gold for silver when ratio went from 56:1 to 37:1
1984 - 1991   - Gold for silver when ratio went from 18:1 to 98:1
1991 - 1998   - Silver for gold when ratio went from 98:1 to 42:1
1998 - 2004   - Gold for silver when ratio went from 42:1 to 79:1
2004 - 2008   - Silver for gold when ratio went from 79:1 to 50:1
2008 - 2008   - Gold for silver when ratio went from 50:1 to 80:1
2008 - 2011   - Silver for gold when ratio went from 80:1 to 38:1
2011 - 2016/17   - Gold for gold silver when ratio when from 38:1 to today's 70:1

One would need to look back at the historic prices of both gold and silver to determined exactly the premium costs for each exchange, as well as the amounts of metal one would accumulate through each cycle.  But over the course of the past 35 years that original 5 ounces of gold would very likely have grown to 20-30 ounces or more, and your silver stack would be close to 2000 at the time of your most recent exchange here in 2017.

Russian bank follows Japan's lead in bypassing the dollar through connecting to China's CIPS system for interbank settlement

Last month, several Japanese banks took the unprecedented step in bypassing SWIFT and the dollar by connecting directly to China's CIPS platform for interbank settlement.  Now on March 9, Russia is following suit as one of their largest banks announced today that they are officially connecting to CIPS to conduct their own interback settlement with China that will no longer require intervention with the global reserve currency.

Image result for china and russia against the us
Russia's VTB Bank has been successfully connected to Chinese-based Cross-Border Inter-Bank Payments System (CIPS), the bank said on Wednesday. 
"VTB has been linked up to the system via correspondent banks and has successfully completed test operations in late 2015. We are monitoring the development of the introduction of the next phase of the CIPS, which is supposed to increase the operational efficiency of transactions," VTB's press office said in a statement. - Sputnik News
China officially opened their CIPS messaging platform last October as a way to both expand internationalization of the RMB, and to allow for much easier processing between nations in their bi-lateral trade agenda.  And over time the cost savings for both sides of the trade equation will be significant since trade partners will no longer be required to pay currency swaps to SWIFT in their having to buy dollars to act as a medium of exchange.

As more and more nations find direct bi-lateral trade a better and more equitable way of conducting commerce between economies, the less need there will be for countries to have to buy dollars to function in antiquated trade models.  And at the leading edge of this is China, who through coalitions such as the Shanghai Cooperation Organization and Silk Road projects are steadily expanding the idea of direct trade, and in the natural currencies held by each respective partner.

Wednesday, March 8, 2017

The CME Group's leaving the London Silver Fix could forecast the end of silver manipulation by end of the year

Last Friday night we published an article on the bombshell news that the CME Group (Chicago Mercantile Exchange) and Thomson-Reuters was leaving their position as the platform for facilitating the daily 'Silver fix' for the London Bullion Market Association (LBMA).  But what was left out of this was why the two entities would choose to leave this obligation with two years still remaining on their contract.

Now on March 7, more pieces of the puzzle may be coming out as metals analyst Bix Weir came up with some further documentation of an event that is to take place on Jan. 1, 2018 which involves new regulations from the European Union that will make it harder to rig financial markets, including that of Libor, Forex, and obviously precious metals.

The European Commission proposed a draft Regulation “on indices used as benchmarks in financial instruments and financial contracts”(Benchmarks Regulation) in September 2013 in the wake of the manipulation of various benchmarks. On 24 November 2015, the European Parliament and the Council reached a preliminary political agreement on a compromise text of the Benchmarks Regulation, an agreement that was confirmed on 9 December 2015 by the Permanent Representatives Committee of the Council of the European Union. The European Parliament voted and approved the text of the Benchmarks Regulation in its plenary session on 28 April 2016. The Council adopted the same text on 17 May 2016. The text of the Benchmarks Regulation was published in the European Official Journal on 29 June 2016, and entered into force the following day. It is entering into application on 1 January 2018. - ESMA
It is the use of 'benchmarks' rather than having the market itself establish prices for gold, silver, and other assets that has allowed central banks and their primary dealers to manipulate nearly every market, and made price discovery completely irrelevant when it comes to determining the true value of a given asset.

Whether the sudden exit by the CME Group and Thomson-Reuters from their contract with the LBMA is due to recognizing that the writing on the wall for the ending of the manipulation of silver is still to be seen, but with new potential crises coming onto the scene in both Europe and the U.S.'s financial systems, the possibility that the central banks will soon no longer be able to rig asset prices could come as soon as the start of next year.

Vault 7 Wikileaks revelations look like something straight out of a Jason Bourne movie

They say that the establishment uses Hollywood and other media platforms to drop hints on programs they are involved in, or things they want to slowly desensitize the public on to prepare them for the day when paradigm shifting events will be revealed.  And whether this is in regards to a dystopian future where there world is run by corporations rather than by sovereign governments (Tekken, Highlander 2), or where technology replaces human labor in many if not all facets of society (I, Robot), the fact is that much of what the future reveals for society has already been imagined or purposely pushed into the mainstream through the use of books, movies, and other media.

So when on March 7 Wikileaks unveiled its newest and perhaps most earth shattering data dump on the activities of the CIA, one could not be far off in believing they were watching a Jason Bourne movie coming to life through the information held in Vault 7.

Operation Treadstone through Operation Iron Hand

One of the revelations made in yesterday's Wikileaks data dumps was the fact that the CIA used their consulate in Frankfurt Germany as an operations center for cyber-hacking programs that quite possible even included renditions .

Still_-_7

Image use courtesy of Universal Pictures
In addition to its operations in Langley, Virginia the CIA also uses the U.S. consulate in Frankfurt as a covert base for its hackers covering Europe, the Middle East and Africa. CIA hackers operating out of the Frankfurt consulate ( "Center for Cyber Intelligence Europe" or CCIE) are given diplomatic ("black") passports and State Department cover. 
The instructions for incoming CIA hackers make Germany's counter-intelligence efforts appear inconsequential: "Breeze through German Customs because you have your cover-for-action story down pat, and all they did was stamp your passport" - Zerohedge

Renditions against civilians, including a journalist from the Guardian Newspaper

In the third installment of the Jason Bourne series, a journalist from The Guardian newspaper had stumbled upon the secret and illegal programs being done by the CIA in regards to Treadstone.  And through their massive data mining and surveillance of all communications in the UK and other places around the world, they pieced together who the reporter was, and subsequently ordered his death.

Now flashback four years ago to June 18, 2013 when Rolling Stones reporter was killed in a car accident when his vehicle suddenly and without warning accelerated to nearly 100 mph and where it appears someone had taken over control of his car's electronic system to have him killed while 'looking' like an accident.

And what was Michael Hastings investigating at the time of his sudden death?  The CIA's Director John Brennan.
A day after Hastings’ death, Robin Abcarian of the Los Angeles Times reported Hastings had been investigating CIA Director John Brennan at the time of his demise. Within hours, her colleague Brian Bennett contradicted her story claiming Hastings had been researching Florida socialite Jill Kelley instead. 
A few days later, LA Times reporter Andrew Blankstein debunked Bennett’s article and confirmed Hastings had been investigating CIA Director John Brennan at the time of his death. Although Bennett’s article is full of false information, the editorial staff has refused to make any corrections. 
Less than a year before Hastings’ death, Wikileaks posted a series of hacked emails taken from the private intelligence firm Strategic Forecasting (Stratfor), including an email stating, “Brennan is behind the witch hunts of investigative journalists.” - Free Thought Project
And of course now we now from the Wikileaks data from Vault 7 the CIA has perfected malware that is able to not only take control over a vehicle's electronic system, but that it allows the agency to commit assassinations without detection.
As of October 2014 the CIA was also looking at infecting the vehicle control systems used by modern cars and trucks. 
The purpose of such control is not specified, but it would permit the CIA to engage in nearly undetectable assassinations.
CIA breaking the law by spying on, and conducting operations against U.S. citizens on domestic soil

In nearly every Bourne movie the CIA at certain points was conducting operations not only on U.S. soil in violation of their charter, but also against U.S. citizens whom they determined to be a threat either to the United States itself, or to the secrecy of their illegal programs.  And in the third Bourne movie we find several U.S. citizens who had been summarily killed without due process.

In 2013 the liberal Washington Post expressed outrage after the revelation that the Justice Department had investigated the news gathering activities of a Fox News reporter as a potential crime in a probe of classified leaks.  The reporter, Fox News’ James Rosen and his family, were part of an investigation into government officials anonymously leaking information to journalists. Rosen was not charged. However, his movements and actions were tracked. 
* Also in 2013, members of the Associated Press were also a target of the surveillance.  The ultra liberal New Yorker even noted that “In moderate and liberal circles, at least, the phone-records scandal, partly because it involves the dear old A.P. and partly because it raises anew the specter of Big Brother, may well present the most serious threat to Obama’s reputation.” 
* Sharyl Attkisson reported her personal computer and CBS laptop were hacked in 2014. This occured after she began filing stories about Benghazi that were unflattering to the Obama administration.  A source who checked her laptop said the hacker used spyware “proprietary to a government agency,” according to an article in the New York Post. - The Black Sphere
Additionally, one has to wonder if the one or more CIA insiders who provided Wikileaks this treasure trove of information didn't represent in part the character of Jason Bourne, who grew a conscience after waking up from the programming he had endured in becoming a covert operative and trained assassin.

They say truth is stranger than fiction, but many times the idea of what eventually becomes fact was dreamed up somewhere in a plot line of a movie, or the storyline of a book.  And it is amazing how often bombshell revelations like this new one from Wikileaks can mirror something dreamed up in Hollywood or at Barnes and Noble, unless those books and films themselves were produced by the very individuals and agencies who would eventually be discovered to have done exactly what those movies implied.

Monday, March 6, 2017

Ron Paul to speak to Arizona legislature to help push through bill to make gold and silver legal tender

On Wednesday March 8, former Congressman and Audit the Fed champion Ron Paul will be speaking to the Arizona Senate Finance Committee regarding Bill HB2014, and the benefits of making gold and silver legal tender in the state.

HB2014 encompasses two key components regarding gold and silver.  First, it recognizes the metals as legal tender in accordance with the Constitution of the United States, and second it would remove any state capital gains taxes on the sale of these metals, making it easier for Arizonan's to begin the process of using gold and silver as money now, or in the near future.

Image result for ron paul gold standard
Audit the Fed is not the only focus of the growing anti-Fed movement. For example, this Wednesday the Arizona Senate Finance and Rules Committees will consider legislation (HB 2014) officially defining gold, silver, and other precious metals as legal tender. The bill also exempts transactions in precious metals from state capital gains taxes, thus ensuring that people are not punished by the taxman for rejecting Federal Reserve notes in favor of gold or silver. Since inflation increases the value of precious metals, these taxes give the government one more way to profit from the Federal Reserve’s currency debasement. 
HB 2014 is a very important and timely piece of legislation. The Federal Reserve’s failure to reignite the economy with record-low interest rates since the last crash is a sign that we may soon see the dollar’s collapse. It is therefore imperative that the law protect people’s right to use alternatives to what may soon be virtually worthless Federal Reserve notes. 
This Wednesday I will be in Arizona to help rally support for HB 2014, speaking on behalf of the bill before the Arizona Senate Finance Committee at 9:00 a.m. I will also be speaking at a rally at noon at the Arizona state capitol. I hope every supporter of sound money in the Phoenix area joins me to show their support for ending the Fed’s money monopoly. - Ron Paul Institute

Bitcoin vs. gold? How about a new crypto-currency that will be backed by gold

As the USD price of Bitcoin reached and then surpassed the USD value of gold last week, there has been a great deal of discussion over which is a better form of wealth protection to own.  In fact, both Bitcoin advocates and gold bugs alike agree at the foundation that both are better alternatives to holding one's money in fiat currencies like the dollar or euro, and in financial institutions that are only solvent because central banks have been printing money to prop them up.

But this is where the similarities end as at their core, one is no different than all sovereign based fiat currencies created and backed by nothing while the other is a physical tangible asset that has a 5000 year track record of being used as both money, and a globally recognized store of wealth.

So the questions that have to be addressed regarding the rise of Bitcoin at the present are; is Bitcoin actual money, is it a viable medium of exchange, does it function as a store of wealth, and lastly, does its volatility make it more of a speculative investment rather than a currency able to be used in all types of commerce?

Yet rather than try to argue and debate each of these points regarding the future use and acceptance of Bitcoin, what if the future of crypto-currencies was to actually back them with something tangible?  And that is exactly what is now emerging between a U.S. and Australian company as the two have created a new crypto-currency called OZcoinGold that provides all the decentralized and secure features that are intrinsic with most other forms of digital money on the Blockchain, but it is also being backed by physical gold at a ratio of 1 oz to every 100 OZcoins.


A US company, in partnership with an Australian publicly listed mining company, will launch the world's first crypto-currency backed by gold. www.ozgld.comThe launch will be at the South By Southwest (SXSW) on March 10th, 2017 in Austin, Texas. 
The creation of OZcoinGold, a crypto-currency developed on the 3rd Gen. blockchain, was conceived by CTO Joh Breytenbach when he realized that capital intensive public listed commodity and resource companies experience excessive expenses when raising capital for expansion as well as high regulatory restrictions and high loan costs. 
Further Ira stated "An advantage to the owner of OZcoinGold is that gold is purchased at the regular Gold price Benchmark, thus ignoring the Bid - Ask variation, which can be significant." 
The value proposition is that the gold mining company has a proven reserve of 600,000 ounces of gold under the international geocode which is sufficient as a security over any financial instrument. Further "assayed reserves" are estimated at more than 10 million ounces of gold. The mine has given OZcoinGold security over 100,000 ounces of this gold reserve. 
The OZcoinGold is issued in the ratio of 100 OZcoinGold per one ounce of 24 karat gold. So each ounce of Gold backs one hundred OZcoinGold coins. - Yahoo Finance

Sunday, March 5, 2017

RMB internationalization could soon get major boost as desperate EU looks to bail out financial system with Yuan bonds

After a modicum of success in expanding the RMB's use outside of China when their currency became accepted into the IMF's SDR basket of currencies last year, the Yuan has since seen a slowdown for internationalization due in part from capital controls they instituted to try to restrict a growing occurrence of capital flight.  But in an interview given on March 5 by the head of the European Stability Mechanism (ESM), that may soon be changing as the financial body responsible for protecting the stability of the Eurozone suggested that the next round of 'Quantitative Easing' may involve bonds denominated in Yuan as the foundation for bailing out banks and other financial institutions.

The head of the organization charged with safeguarding financial stability in the eurozone said he does not rule out issuing Chinese yuan-denominated bonds to fund the rescue of European nations and institutions. 
"[Issuing European Stability Mechanism bonds in yuan] is possible," Klaus Regling, managing director of the ESM, said in a recent interview with the Nikkei Asian Review. He said the institution was preparing to issue dollar-denominated bonds in the fourth quarter of this year -- the ESM's first non-euro bond issuance -- but added that other currencies remained an option. 
"We are legally allowed to issue in all currencies," he said. "As a young institution, it is a big step to do our first non-euro issue ... and it seems to make sense from the market side to start with the U.S. dollar. But it is entirely possible that we move into other currencies that are attractive from the market side." - Asia.Nikkei
The European Stability Mechanism (ESM) is Europe's equivalent of the U.S.'s Exchange Stabilization Fund (ESF) in that it acts as a neutral party, able to step in and fill any monetary needs for the financial system.

If the EU is now looking towards the Chinese Yuan as a much better asset and currency to sell to fund and bailout European financial institutions in the future, then this will go an extraordinarily long way in fulfilling China's goal of internationalizing the Yuan, and moving it towards becoming an equal shareholder with the dollar as one of the world's primary reserve currencies.

How does J.P. Morgan's trading desk have 0 losses in two years? Short mining stocks then crash metal prices to cover

According to a recent report out by Zerohedge, J.P. Morgan's trading desk had one of the most incredible, and impossible win streaks ever seen on Wall Street.  In fact, not only did they not have a single losing trade in 2016, but between 2012 and 2016 they only had two singular losing trades out of billions if not hundreds of billions conducted in the HFT sphere.

Thus the question one has to ask of course is how is this possible since the the average win ratio for even the best individual trader is around 58%?  And in an interview on March 3 with Peak Prosperity's Chris Martenson, the long time financial analyst lays out one of the many scenarios used by the investment bank through their shorting of mining stocks, then crashing metals when the markets are closed by dumping billions of dollars of naked shorts on the Comex to skim the profits, and then cover their positions.

Image result for jp morgan manipulating silver market
Rory Hall:  I want to get back to something we we're talking about a moment ago, and that is silver.  And how do you see yesterday with this silver beatdown, and where silver was raped for better lack of the word, by more than 4%... there was something like $2 billion worth of digital contracts thrown at it in about a half an hour.  What's your take on that? 
Chris Martenson:  There is a fairly complex take on this, but let me make it simple here... it's fraud.  And it's not just in the silver market.  I follow silver and gold closely so I'm aware of this there, but I can tell you it happens everywhere now because the big banks long ago won the battle and captured the SEC under Mary Jo White, and it's been a complete disaster of lack of regulation. 
So here's is the focus on how and where this theft, this fraud is committed.  The big commercial banks that are out there... J.P. Morgan, HSBC, all the big bullion banks that are playing in this market.  They go out there and take the opposite side of this trade, and they are rapidly getting shorter, and shorter as the price of silver is going up.  And taking the other side of that bet are only people I can assume are named Charlie Brown, because they fall for it everytime.  And the banks have done this a dozen times over the past five years. 
But here's the tell... as silver was rising the last three days before that big smackdown, the miners... the silver miners in particular were very weak.  In fact, they were going down. 
So when you see the stocks going down at the same time the metal's are going up, you know that someone is aggressively selling those... they are shorting the stock, selling the stocks short. 
So they build a huge naked short position in the mining stocks, and within days BAM!  And the next thing you know the price of silver gets hammered... monkey hammered in the aftermarket.  After the physical London market is closed they always do it then, if not at 1:30 in the morning, and they just flood the market and crush the bid stack, driving the price down.  They they simply buy back and cover their shorts and skim the profits while leaving everyone holding the stock, or a futures contract, as the loser.

Saturday, March 4, 2017

Stock markets now overvalued to levels greater than the 2008 financial crisis and the 1929 crash

Over the past 20 years, and especially since 2009, the Federal Reserve has been using the stock markets as a way to mask the underlying insolvency of the general economy.  It is why every business media outlet and segment pushes what the Dow, S&P, and Nasdaq did on a given day, while minimizing the fact that corporate earnings have declined en masse over the past decade.

Since the election of Donald Trump last November, the Dow has not only crossed the unprecedented level of 20,000, but in a very short time it also soared to over 21,000 in little more than a month.  But what has really happened is that the P/E ratios (Price to Earnings) for companies on these respective exchanges have nearly doubled their historic averages, and are now above the bubble levels seen just prior to the Dot Com crash, the 2008 financial crisis, and even the greatest market event in the nation's history, that of October 1929.

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So, in the name of history, let us briefly examine some of its most important economic factors and how they apply to current market conditions. The present S&P 500 price to earnings (P/E) ratio is 26.52, as opposed to the historical median average which is 14.65. Perhaps more importantly the Schiller P/E is presently 29.27, when the median average is only 16.09. Ironically, 29 is the level the market hit on black Tuesday 1929, right before the great depression of the 1930s. Furthermore, the Schiller benchmark is now well above the 25 level the Shiller PE hit before the great recession in 2007. 
Possibly, most troubling is the S&P's price to sales ratio which is 2.08 a level not seen since the dotcom boom and subsequent bust of course. On average companies that make up the S&P 500 are being valued at more than 2 times sales. This is extremely ambitious and clearly indicates that share prices are appreciating much faster than companies are growing their revenues. The phenomenon we are observing now is somewhat reminiscent of the late 1990s. However, unlike in the late 90s when the U.S.'s GDP was growing at approximately 4.5% now the U.S. economy is barely averaging 2%, huge difference indeed. So, a logical question would be why are we seeing such a drastic appreciation in risk asset prices if the growth is simply not there to support it. - FX Street

Friday, March 3, 2017

Breaking! Just months after banks admit rigging silver price, LBMA administrators suddenly resign from the London price fix

On March 3 the CME Group, along with Thomson Reuters, without warning announced their resignation from running the auctions which set the daily silver price for the LBMA.

Long known as the London Price Fix, this sudden resignation by the two U.S. corporations which play an intrinsic role in controlling the price of silver comes just months after Deutsche and other banks admitted in court that they have been rigging prices in the silver markets for more than a decade.

CME Group and Thomson Reuters are to step down from providing the LBMA silver price benchmark auction, the London Bullion Market Association said on Friday, less than three years after they successfully bid to provide the process. 
"In consultation with the LBMA, CME Group and Thomson Reuters have decided to step down from their respective roles in relation to the LBMA Silver Price auction," the LBMA said in a members update seen by Reuters. 
The two will continue to operate and administer the silver auction until a new provider is appointed, the LBMA said. It will launch a new tender to appoint an alternative provider to operate the process "shortly", it said. - Reuters
The Chicago Mercantile Exchange (CME Group) is the world's largest commodity derivative exchange, and plays an essential role in allowing the Federal Reserve and its primary dealers (bullion banks) to manipulate gold and silver prices through the use of naked shorts and other derivatives.

After yesterday's manipulated takedown of gold price, divergence between London and Shanghai back to $28

As soon as London markets closed on March 2, bullion banks instantly dumped 1.15 million ounces (23,000 contracts) to smash down the price of gold using naked paper shorts.

The move appears to be in preparation for Friday's announcement by the Federal Reserve, but also because gold recently achieved a Golden Cross formation, signalling to technical traders a strong buy signal.

Silver Has Just Been Smashed 85 Cents to $17.70, and Gold Prices Have Just Been Sent Plunging to a Last of $1232. 
What Just Triggered the Massive Free-Fall Plunge? 
FED GOONS…giving cover for bullion banks to drop $2 BILLION in paper silver (thats over 23,000 contracts, or 1.15 MILLION OZ) as soon as London closed. - Silver Doctors
In the meantime this artificially manipulated takedown of the gold price was not recognized over in China, where the difference between the PM Gold Fix and Shanghai and the AM Gold Fix in London for March 3 is now back up to $28.

Shanghai PM Gold Fix - March 3 2017


London AM Gold Fix - March 3 2017


Thursday, March 2, 2017

As global currencies roil in turmoil, Bitcoin has now officially reached parity with the price of gold

After shifting Westward since the beginning of the year, when Bitcoin's price movements were primarily tied to Chinese influence, the crypto-currency has not only reached a new all-time high on March 2, but it has also achieved parity with the current price of gold.

Diverging together at $1236 apiece just minutes ago, the alternative choices to holding fiat currencies are now justifiably vying for the market share of individuals around the world who experiencing severe crises in their own economies and local currencies.

Bitcoin Chart:


Gold Chart:

Live New York Gold Chart [Kitco Inc.]

Global currency troubles:

Venezuela: The Central Bank of Venezuela says the country is down to just $10.5 billion in foreign reserves. At the same time, Caracas has to meet debt obligations of $7.2 billion this year.

Greece: Now, fresh tensions over the country’s bailout are putting that progress at risk. About 1.3 percent of deposits were pulled from the banks in January, while bad loans crept higher, an increase Bank of Greece Governor Yannis Stournaras blamed on borrowers using the deadlock with creditors as an excuse to avoid making their payments.

Greek officials are meeting in Athens this week with representatives of the euro area and International Monetary Fund to set out the policies Greece must undertake to unlock more loans. The government foresees an accord in March or early April, but the scale of pending issues raises concerns they may be politically hard to sell at home.

U.S.: On March 15, the latest suspension expires and the debt limit will likely reset a little north of $20 trillion.

If Congress has not voted by mid-March to either extend the suspension or raise the ceiling, Mnuchin will have to start using special accounting measures just to keep paying the country's bills without violating the borrowing limit.

With the gold price currently being held down through the Comex and London derivatives markets, the likelihood of Bitcoin's price soaring well past that of the yellow metal is very real, especially as the Federal Reserve has come out in recent days almost assuring the markets of another rate hike.  And this will only add more fuel to the crypto-currency's legacy as it officially becomes one of the world's most popular alternatives to holding one's wealth in any sovereign currency.

Wednesday, March 1, 2017

World's largest retailer Walmart pushing customers towards eliminating use of cash in their stores

As governments around the world mull over, or actually start to implement the elimination of physical cash, the world's largest retailer Walmart is now jumping onto this bandwagon.

In a new initiative announced on Feb. 28, the retail giant updated their mobile app with a new feature meant to entice customers to perform their pharmaceutical and money changing activities online, with the carrot incentive of no longer having to wait in line to fill out their documentation or to pay for these services.

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Walmart yesterday launched a new initiative in its drive towards zero-cash at its stores. 
The world's largest retailer has added a new feature to its mobile app, which would allow its pharmacy and money services customers to beat long queues, The Street reported.
Whether it was about refilling a prescription or wiring money, all tasks could be done without paperwork and checking prescriptions before stepping into the store, the report said. 
Walmart said while customers would still need to visit the store to pick up prescriptions and verify payments made through money services, express lanes would be set up to cut waiting times to as little as 40 seconds as against six to 11 minutes at present.
The app and express lanes would be introduced at 1,200 locations in March,  and extended to 4,700 US stores by the fall. - Domain B
In 2016 Walmart introduced an app called Walmart Pay in which customers would no longer need to use physical cash, or even receive a physical receipt when checking out as they would pay and document their purchases completely on their smartphones.

While cashless retail shopping is not widespread in the U.S. at this time, a growing number of countries in Europe are nearly 100% cashless, with many of their own retailers no longer even accepting physical cash as payment for items or services.

Tuesday, February 28, 2017

After years of vilifying Bitcoin, now the Mainstream Media sees it as a savior for China's monetary system

First they ignore you, then they laugh at you, then they fight you, then you win.  These were the words of a famous revolutionary who used non-violent protest as the means to overthrow the British Empire from its hold over India.

Now in 2017 there is another revolution going on that is for the future of the world's money.  And where even as recently as three years ago the mainstream establishment media was both scoffing at and vilifying the advent of crypto-currencies and those who embraced them, on Feb. 27 that same mainstream media is now hailing Bitcoin as the potential savior for the monetary system of the world's second largest economy.

China’s new bank regulator, Guo Shuqing, is by all reports the reformer the second-biggest economy desperately needs. His 17 months as stock market watchdog served up so many directives so rapidly that traders called him “Whirlwind Guo.” 
He arrives on the banking scene at a moment when China’s financial system is in a whirl of its own. The immediate challenge - murky, debt-laden banks threatening China’s economic outlook - is well known. But a longer-term threat, an existential one, is landing along with Guo: a Chinese government version of Bitcoin that makes you wonder if the nation will even need banks in 10 years. 
In creating its own cryptocurrency, Beijing is taking the whole if-you-can’t-beat-them-join-them concept to new heights. Earlier this month, the People’s Bank of China sent shockwaves through Bitcoin circles by halting withdrawals and bringing the heads of cryptocurrency exchanges in for a good talking-to. Then last week, the PBoC announced it’s going digital in a big way. As China mints its own block-chain medium, will it ban Bitcoin transactions? Given the tight correlation between zigs in the yuan and zags in Bitcoin values, the PBoC’s entry could be a game changer - and not necessarily for the worse. - Barron's

Sunday, February 26, 2017

Could millennial snowflakes be the catalyst to keep the U.S. from eliminating cash?

If there is one thing to be said about millennials it is that they are very emotional about their activism.  And all one has to do is look over the past couple of years at their push for 'safe spaces' on campuses, rabid protests over a myriad of different topics, and the rejection of many status quo policies that have been at the core of America's government over the past 20 years.

So with central banks, sovereign leaders, and elitist academics all pushing hard for the elimination of physical cash in the world's monetary systems, an interesting irony is coming to the surface where today's millennials could be the catalyst for protecting the economy from going 100% into a digital system.

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If millennials are supposed to be the first generation going mostly cashless, they are making the move halfheartedly.
Millennials still rely on cash — 80 percent of millennials carry greenbacks. And 42 percent still write checks, according to the Accel + Qualtrics Millennial Study 2017.
And that could be a good thing, as some advisors say a cash diet is the best way to pare down debt. 
The study corroborates other recent findings that technology is not overturning conventional ways to pay for things, even as millennials flock to mobile payment apps like Apple Pay and Venmo. 
Sophia Bera, a millennial who founded Gen Y Planning and is a member of the CNBC Digital Financial Advisor Council, said most of her friends carry some cash, but she rarely sees them using it as the first option to pay for things. It's mostly cash for emergency situations, or cash for tips.  
"When I use Venmo it feels like magical money," Bera said. "You forget that it is money, like any money, and that is bad." 
The financial advisor highly recommends cash to people trying to get out of credit card debt or for sticking to a budget. "A weekly cash amount is good," Bera said. "Take out $200 every Friday and when it is gone it is gone. ... It's a lot harder to drop six twenties on a dress than swiping a card. People don't buy flatscreen TVs with $20 bills."
Bera said switching to cash, even for just a few months, can help people reign in spending, and is especially helpful for those trying to get out of debt. - CNBC
Psychology has always played a huge role in how people see and respect money.  And all one has to do is look at a casino, which exchanges your currency for casino tokens (chips) because they know that gamblers are more than willing to spend these tokens in greater quantities than if they were playing a table game using real money.

Additionally, people became inured to accumulating high levels of debt when all they had to do is pay a paltry minimum amount which they could afford despite the fact they were actually increasing their debt levels through the interest compounding on that debt.

For a generation of Americans who suddenly had a wakeup call from the massive amounts of student loan debt they accumulated, recognizing the power of money by desiring to use cash instead of credit is a life-changing paradigm.  And even with America's youth being much more attuned towards using technology for nearly everything in today's society, their lagging in the transition to a cashless digital society because they realize that spending cash over credit is extremely beneficial to keeping oneself out of debt, could be a serious factor in hindering the establishment's agenda towards making all of finance one without physical money.

State of Idaho joins Utah and Arizona in forging legislation to recognize gold and silver as money

Earlier this year, the states of Utah and Arizona both proposed legislation to eliminate state taxes on the buying and selling of gold and silver in a first step initiative to have them once again recognized as money and legal tender.  Now on Feb. 24 we can add the state of Idaho to the mix as the growing trend towards returning to sound money is starting to pick of steam.

A bill introduced in the Idaho House would eliminate state capital gains taxes on gold and silver specie, and encourage its use as currency. Final approval of the legislation would help undermine the Federal Reserve’s monopoly on money. 
House Majority Leader Mike Moyle introduced House Bill 206 (H206) on Feb. 23. The legislation would amend Idaho revenue statutes, providing “that capital gains and losses on precious metals bullion and monetized bullion sales be added to or subtracted from Idaho taxable income.” 
The Framers of our nation established that gold and silver are money, but federal taxing authorities in recent decades have required taxpayers to pay taxes on this form of money when its exchange for Federal Reserve Notes results in nominal capital “gains.” 
Similar to a bill recently passed by Arizona’s state House, Idaho H206 is a pure and tax neutral proposal. That’s because both precious metals gains (income) and losses are backed out of the calculation of one’s Idaho taxable income.   While HB206’s passage will have little fiscal impact as to Idaho tax revenues, it will have a larger impact on Idahoans’ freedoms. 
Enjoying the backing of the Sound Money Defense League, the Idaho Freedom Foundation, and Money Metals Exchange (an Idaho-based national precious metals dealer), the Idaho proposal seeks to correct the misclassification of precious metals by the IRS as “property” rather than money.  It is only because of this misclassification in the first place that precious metals income and losses are included in the federal adjusted gross income number that flows through to the taxpayer’s Idaho tax return. - Tenth Amendment Center

Saturday, February 25, 2017

As Bitcoin and gold converge at $1250, which asset is the best to buy with your money?

On Friday Feb. 24 we saw the price of gold end the week over $1250, and bitcoin near its own all-time high of nearly $1230 begging the question of which asset of the two is the best to buy if you have the money.

Followers of either gold or bitcoin have strong arguments both for and against each asset, while there are also a number of investors who are in favor of owning both as a means of wealth protection.  However, if an individual only had $1250 to spend on one or the other, what parameters would separate the two to make one stand out more than the other.


Bitcoin has the potential for much bigger growth, and in this it acts as both a form of currency and type of investment.  But Bitcoin relies upon many factors such as widespread public acceptance to function in commerce, and the hope that governments do not criminalize the crypto-currency as being a threat to their monetary systems.

Additionally however, Bitcoin is completely portable and transferable, and can be taken across borders without anyone having knowledge of its existence.

But perhaps it's biggest failing is that it is not tangible in the physical sense, and has as much emotional value to an individual as their plastic debit card, or even as poker chips do while gambling in a casino.

Live New York Gold Chart [Kitco Inc.]

Gold on the other hand has a history stretching back to the beginning of mankind, and has been both money and a store of wealth of over 5000 years.  And while it is much more difficult to store in larger quantities than Bitcoin, and much more difficult to transfer across borders and customs than if someone simply carried a pen drive with them in their carry-on luggage, gold is easily the most recognizable form of money and could be used for commerce in just about every city, nation, or village on the planet.

As fiat currencies show their age and their accelerating decline in value, assets like gold and Bitcoin will both reign as strong alternatives for people to transfer their wealth into for the distant future.  And the question of which one to choose will become a real issue in the days ahead now that both have reached virtual equilibrium in both price and desirability.


Friday, February 24, 2017

Is South Africa looking to become the next BRICS nation to go cashless?

Over the past four months we have seen India begin the difficult process of weaning her people off of physical cash, as Prime Minister Modi has officially called for the implementation of a digital monetary system.  Then earlier this week we began to hear word that Russia was investigating the taxing of individuals who chose to use cash in transactions and other commerce.

Now on Feb. 24 we can add South Africa to the growing list of BRICS nations who might be setting the stage for eliminating physical cash in their economies and creating a completely digital monetary system.

Image result for africans want digital currency
Globally, cash, as a means of transaction, has been on the decline for decades.
First World countries are leading the transition. 
In emerging market countries, such as China, South Africa and India, for example, more than 90% of payments are still cash based. 
We have also seen how quickly, thanks to our almost complete mobile penetration, blockchain technology, such as Bitcoin has taken off in South Africa across all strata of our economy. 
These are signs that South Africa’s transition to a cashless environment could happen very quickly indeed. - Biz Community
Unlike the forced banning of cash which we have seen in India, and may soon see in Russia, the move towards digital money in South Africa may instead come from a voluntary push as citizens trust less and less in the nation's primary sovereign currency.

World's largest gold backed ETF now certified as Sharia Law compliant

On Feb. 23, the U.S. run SPDR Gold Shares ETF was certified as Sharia Law compliant, making it the first gold based financial instrument to be open to the new Islamic statutes on gold ownership for the world's 1.6 billion Muslims.

Run by State Street Global Advisors, and reportedly backed by $30 billion in physical gold, the ETF could soon become a springboard for new investment from the Islamic community.

Image result for sharia law gold
U.S. asset management company State Street Global Advisors has announced that a huge exchange-traded fund for investment in gold has been certified as being compliant with Islamic financial law. 
The question of whether ETFs themselves comply with Islamic law has not been addressed. However, the certification by Amanie Advisors of Malaysia, a leading sharia advisory company specializing in Islamic financial institutions, is expected to stimulate investment in the gold ETF within the Muslim world.  
The fund, called SPDR Gold Shares, is one of the world's largest ETFs backed by gold bullion, having a net asset balance of more than $30 billion. Managed and marketed by State Street Global, it is listed on the New York Stock Exchange. - Asia.Nikkei

Thursday, February 23, 2017

Gold price hits 15 week high as it crosses over $1250 for first time since just after election

On Feb. 23 the gold price rose more than $10 per ounce to cross $1250 for the first time since just before Donald Trump won the Nov. 8 Presidential election.

Prior to that election, gold had once again crossed over $1300 per ounce, something it had not done since its massive move last June following the Brexit vote in the UK.  But with the outcome of the ultimate outsider winning the highest office in the land, markets dumped gold contracts en masse which would eventually see the price fall into the low $1100's.

But since the beginning of year, both gold and silver have slowly risen, and are nearing gains of around 10% in just the first two months of 2017.
Gold prices jumped Thursday, attempting to snap a string of three declines, as the dollar lost ground to chief rivals in the wake of a fuzzier-than-expected interest-rate assessment from the Federal Reserve. 
April gold GCJ7, +1.33% rose $10.80, or 0.8%, to $1,244.10 an ounce. A close at that level would mark the highest settlement for a most-active contract since Nov. 10, 2016, according to FactSet data. Thursday’s gain picks up on an after-hours Wednesday rise and dollar decline. Some metals traders read the Fed minutes out Wednesday as casting doubt on the timing and pace in future rate increases. - Marketwatch

Wednesday, February 22, 2017

Both Donald Trump and Vladimir Putin are working different ends of the tale to kill the petrodollar

In a fascinating dichotomy where both the United States and Russia are implementing different foreign policy angles that will inevitably kill the petrodollar, their main target happens to be the same in the Arab Kingdom of Saudi Arabia.

Back in 1973 Nixon's Secretary of State Henry Kissinger went to Saudi Arabia to forge what would become the next global backstop for keeping the dollar as the world's reserve currency.  But in doing so the U.S. made a promise to protect the Kingdom from foreign invasion, and in return the Saudi's would ensure that OPEC used only dollars in their global selling of oil.

But what the U.S. did not anticipate was the fact that the Saudi monarchy followed a radical form of Islam that was hell bent on seeing all other sects utterly destroyed.  And through their use of money, arms, and terrorism over the past 40 years, the U.S. has been forced to intervene in many of these unprovoked attacks on Saudi's Arab neighbors, and have played a major role in both toppling governments, as well as aiding terrorism.

And in 2017 with the election of Donald Trump, this all appears about to change, and could signal that the new U.S. President is content with letting the old petrodollar agreement dissolve away.

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Unlike every president since the petrodollar’s birth, Donald Trump is openly hostile to Saudi Arabia. 
The Saudis did not want Donald Trump in the White House. And not because of some bad blood on Twitter. There are real geopolitical issues at stake. 
At the moment, Trump seems determined to walk back on US support for the so-called “moderate” rebels in Syria. 
The Saudis are furious with the US for not holding up its part of the petrodollar deal. They think the US should have already attacked Syria as part of its commitment to keep the region safe for the monarchy. 
Toppling Syrian President Bashar al-Assad is a longstanding Saudi goal. But a President Trump makes that unlikely. That’s not good for Saudi Arabia’s position in the Middle East, nor its relationship with the US. 
This is just one of the ways President Trump will hasten the death of the petrodollar. - International Man
On the other side of the gambit is Russia's President Vladimir Putin, who has not only sided with Syria's Bashir Assad in fighting the Islamic Caliphate's attempts to topple the government, but in a recent and unprecedented move invited Sunni clerics to a conference in which they castigated Saudi Wahabism as being deformed in the construct of Islam.
At the end of August, a meeting of Muslim clerics and scholars convened in the Chechen capital of Grozny to forge a consensus on the subject of ‘who constitutes a Sunni.’
Sunnism, the 200 or so Sunni clerics from Egypt, South Africa, India, Europe, Turkey, Jordan, Yemen, Russia warned, “has undergone a dangerous deformation in the wake of efforts by extremists to void its sense in order to take it over and reduce it to their perception.” 
The Muslim world is currently under a siege of terror, led by a deviant strain that claims religious authority and kills in the name of Islam. So the Grozny participants had gathered, by invitation of the Chechen president, to make “a radical change in order to re-establish the true meaning of Sunnism.” 
If their final communique was any indicator, the group of distinguished scholars had a very particular message for the Muslim world: Wahhabism - and its associated takfirism - are no longer welcome within the Sunni fold. 
Specifically, the conference’s closing statement says this: “Ash’arites and the Maturidi are the people of Sunnism and those who belong to the Sunni community, both at the level of the doctrine and of the four schools of Sunni jurisprudence (Hanafi, Hanbali, Shafi’i, Maliki), as well as Sufis, both in terms of knowledge and moral ethics." 
In one fell swoop, Wahhabism, the official state religion of only two Muslim countries -Saudi Arabia and Qatar - was not part of the majority Muslim agenda any longer. - Russia Today
The monetary stronghold for the petrodollar system has already been shattered when Russia and China signed an agreement to sell oil in both Yuan and Rubles a few years ago, and it appears that very soon the final matchstick in the 1973 agreement will fall as well with the coordinated efforts of the U.S. and Russia in eliminating ISIS and the independent terror groups that were spreading Saudi Wahabism through the Kingdom's financing them with money and arms.  And when this happens for good it will create a great vacuum in the global financial system, and all bets are off as to who will win the crown that replaces the dollar as the world's reserve currency.

The mayor of Philadelphia proves why liberals should never be in charge of finance, economics, or anything to do with money

For years liberal politicians have used the offer of free stuff to try to entice the voting public into believing that money simply grows on trees and that the laws of economics don't matter if the right party is in office.  Case in point, the fact that Bernie Sanders ran for the Presidency on a platform of free education, free healthcare, and a myriad of other free welfare programs that would have doubled the national debt from $19.5 trillion to right around $40 trillion.

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Presidential contender Bernie Sanders' broadly progressive tax and spending proposals would add a whopping $21 trillion to the national debt over the next decade, according to a joint analysis released Monday. 
Sanders' proposals would cost $33.3 trillion in new spending, mostly from his health-care proposals — more than double the $15.3 trillion in new taxes, mostly on wealthier American households, that he proposes if he's elected president, according to the analysis by the Tax Policy Center. - CNBC
Of course, socialists, liberals, and Marxists like Sanders fail to ever look at the long history of nations who implemented their own versions of this, and the graveyard of failed economies that resulted from it.

Their solution?  More of the same, only on a much greater scale.

But liberal economics isn't relegated to just 'taxing the rich'.  And whether it involves trying to bankrupt individuals and economies through moronic schemes such as carbon credits, they have never learned that when governments get involved in an economy, there are consequences that emerge that they never plan for.

Such as in the city of Philadelphia, where the Mayor's push to 'fight obesity' through a beverage tax has now resulted in a massive decrease in tax revenues, and the onset of layoffs in industries that sell soda and other drinks with a modicum of sugar.

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According to Philly.com reports, two months into the city’s sweetened-beverage tax, supermarkets and distributors are reporting a 30% to 50% drop in beverage sales and - adding insult to injury - are now planning for layoffs. 
One of the city's largest distributors told the Philadelphia website it would cut 20% of its workforce in March, and an owner of six ShopRite stores in Philadelphia says he expects to shed 300 workers this spring. “People are seeing sales decline larger than anything they’ve seen up to this point in the city,” said Alex Baloga, vice president of external relations at the Pennsylvania Food Merchants Association. 
Since all of this is taking place as previewed in a recent post: "The 'Soda Police' Just Learned A Valuable Lesson About Taxes", we doubt it would come as a surprise to anyone, although we are confident that Philadelphia city workers will be amazed by these unexpected developments. 
Sure enough, in response instead of admitting the tax was a bad decision, the city lashed out by launching the latest "fake news" campaign, when it questioned the legitimacy of the early figures and predicted that customers responding to the initial sticker shock by shopping outside the city would return. “We have no way of knowing if their sales figures and predicted job losses are anything more than fear-mongering to prevent this from happening in other cities,” said city spokesman Mike Dunn.
Mayor Kenney harshly rebuked reports of coming layoffs late Tuesday night. 
"I didn't think it was possible for the soda industry to be any greedier," Kenney said in an emailed statement. “…They are so committed to stopping this tax from spreading to other cities, that they are not only passing the tax they should be paying onto their customer, they are actually willing to threaten working men and women's jobs rather than marginally reduce their seven figure bonuses." 
Bob Brockway, chief operating officer of Canada Dry Delaware Valley, which distributes about 20 percent of the city’s soft drinks, said sales were down 45 percent in Philadelphia. The company will lay off 20 percent of its workforce the first week in March. The distributor is a subsidiary of Honickman Affiliates, owned by Harold Honickman, who helped lead the opposition to the tax last summer. The 35 jobs on the line include managers, sales people, and drivers, Brockway said. Sales are up about 20 percent in the suburbs, but that hasn’t helped the business break even, he said. - Zerohedge
The bottom line.  Taxing a product or service to push a political or social agenda simply means people will either quit using it, create a black market for it, or go someplace where there isn't a tax on it.  And all one has to do is look at when states began to tax cigarettes and realize that online sales, and sales of smokes from Indian reservations, would easily defeat the best intentions of liberal economics.